Part BVariance analysis is the quantitative analysis of the difference between actual and expected behavior. (Drury, C.,2012) It is used to maintain control of the company. Firstly, this essay will analyze the reason for the variance of sales, materials, labor and overhead separately, and the second part is the relationship between these variances.1. Sales varianceSales volume variance is the difference between budgeted and standard quantity multiplied by standard margin. (Collier, PM, 2006) The variance is unfavorable because 200 budgeted units were not sold. When the gap is favorable, it means there is a shortage of stock before the end of this period. The difference in the sales price is the difference. The favorable deviation can be caused by 1). The materials are easier to work with. 2). Using skilled workers or improving worker skills exists through training and improving productivity through development. 3). More efficient manufacturing equipment has been installed. The variance is unfavorable in part a and can be caused by 1). Use a small quantity of raw material that is not easy to work with 2). New work of low-skilled labor leads to inefficient production 3). The manufacturing equipment is old or some technical issues are causing the productivity of the manufacturing equipment to drop. (Collier, PM, (Collier, PM, 2006) The advantages of ABC are: 1. Extends the concept of cost behavior. ABC uses a cost driver to interpret cost behavior and classify costs. costs into short-run variable costs and long-run variable costs.2. Increase the accuracy of product cost calculation While using ABC, direct materials and direct labor can be classified. in products, manufacturing overhead will then be classified into homogeneous cost pool reasonable distribution cost standard The cost allocation standard becomes more direct and specific, which leads to many changes from uncontrollable indirect costs to direct costs. controllable, which provides more accurate information on cost control.3. Real and abundant measurement information that helps the manager make decisions with relevant costs (Drury, C., 2012) 4. Make the product. more competitive. ABC pays more attention to product design, research and development and quantity cost management. Improve competitiveness by allocating limited resources